A new series of articles asking intellectual Toshinao Sasaki a wide range of questions about the future of technology and society.
The theme of the first installment is "DX".
The term "DX (Digital Transformation)" has been around for a long time, but it seems that there are companies that are successfully implementing so-called "DX" and companies that are not.
Sasaki: First of all, in Japan, the definition of ‘DX’ is not very clear. In the 70s and 80s, there was OA, and around 2000 there was IT, and now in the 2020s the term DX is popular. For example, OA is about replacing handwritten documents with photocopies and faxes.
IT-isation means that we are using messengers and e-mails instead of voice data, and OA and IT are simply the digitisation of tools.
However, the basic concept of DX is to reconstruct business models digitally, not to digitalise tools. That is not well understood.
For example, there are people who say, ‘We have DX because we use zoom in remote work, so DX is advanced in our company’ without any hesitation, and there are also people who say, ‘We are introducing DX’. But DX is not a tool, so it is not something to be introduced. It is something that changes the company and the business itself.
What does DX refer to in its original sense?
Sasaki: For example, the automobile industry has until now been a ‘manufacturing industry’, and our job has been to sell finished automobiles. But in the future, automated driving will progress, and there is a possibility that fully automated driving, which is known as Level 5, will eventually be put to practical use.
In that case, drivers will no longer be needed and human-driven cars will be more of a hindrance because they are irregular. Then the act of privately owning a car will become less meaningful. Then the business model of selling finished cars to owner-drivers will disappear.
And at that point, probably all the cars on the road will be something like unmanned taxis. Then the question becomes, what is the job of car companies? Will they make cars and sell them to companies that manage the operation of unmanned taxis, or will they become unmanned taxi management companies themselves?
Naturally, the car companies would go the route of managing their own unmanned taxi fleet and using their own cars there. And even though some decisions will be made by edge computing in the car, the car will not be driven by the car at this time, but by a server in the cloud.
At this point, if we talk about what a ‘car’ is, it is just a terminal, just like a smartphone. That is exactly what DX is. In short, DX is not a tool to be ‘introduced’ digitally, but something that transforms the company or business itself with digital technology.
A typical example of DX is the shift from the conventional model of selling mechanically finished products to a system that is centrally controlled and manages the entire operation of a car, like a smartphone.
Is this a typical example of DX, where the type of work, the industry and the business itself are being updated and changed?
Sasaki: It is common in small and medium-sized enterprises (SMEs) to order their subordinates to ‘put DX into our company’, but the most important thing is for the management to change their mind-set and think about how the company's basic business can be changed to become DX. But the most important thing is for managers to change their mind-set and think about how they can change the company's basic business to become DX.
Japanese people today have become very backward-looking towards IT and technology over the past 30 years since the beginning of the 2000s. The reality is that DX has not progressed at all, especially in companies that are still following the old ways of doing things, and there is nothing we can do to change that.
How did it come to be that way in the last 30 years?
Sasaki: I have analysed various reasons why Japanese people cannot understand the essence of DX, and what I think, not empirically but on a personal level, is that Japanese people have always thought of technology as little more than stationery at their fingertips.
I think that they have never left the world of karakuri dolls of the Edo period or something like that. So they are dexterous with their hands and make things with craftsmanship. For example, I am good at making beautiful crafts such as audio sets and home appliances, but I am not very good at combining machines and people.
In a word, I am not good at platforms. Platforms are not stationery, but the foundation for various human activities, such as communicating with each other. We don't have the idea of technologising that foundation.
I think the only way to do this is to change the mindset. For example, before the rise of the iPhone, there was a great disregard for UI and UX. However, even so, the younger generation is gradually changing.
For example, the Digital Agency has created a vaccination certification app. They have brought in a lot of young people from outside, from start-ups. When you do that, apps with easy-to-use UIs are suddenly created. So I think we have no choice but to change generations.
Conversely, are there any areas where you feel there is potential for DX in the future?
Sasaki: Japan's ageing society and depopulation of rural areas are rapidly progressing, and the country is sometimes referred to as an ‘issue-oriented country’. And in the future, the number of single elderly households will increase rapidly. How to prevent lonely deaths and people falling ill at home alone is a very important issue.
For example, more and more people are now wearing Apple Watches, with improved performance and more functions. It can already measure blood oxygen levels and heart rate, and in the future it is said to be able to measure body temperature and blood pressure at all times. In this way, all kinds of health data on the body and health conditions can be collected as big data.
If this data is analysed by AI, it will be possible to analyse what kind of physical condition a person is most likely to suffer from next. If this is combined with the reality that the number of elderly single-person households is increasing, it would be possible to create a system whereby some kind of alert is issued before a person is hospitalised or dies, and this can be linked to medical institutions and local authorities to prepare.
While overseas platforms are more advanced technologically, there is room for experimentation in developed countries such as Japan in adapting and applying this to the real world, and I think that if we do it well, we could create an interesting business.
This is the DX of health and medicine, where the patient's body is directly connected to the medical institution, and the health condition is analysed using big data and AI.
Toshinao Sasaki
Born 1961 in Hyogo Prefecture. Graduated from Waseda University, School of Political Science and Economics. After working as a reporter for the Mainichi Shimbun and as an editor for the monthly ASCII magazine, he became a freelance journalist. He has published several books, including The Age of Curation (Chikuma Shinsho), Layering the World (NHK Publishing Shinsho), Iemeshi ko ichiboku gochisou desu aru (The best feast is home-made food) (Magazine House) and And living is a way of life. (Magazine House), And, Life Becomes a Community (Anonima Studio), etc. (Anonima Studio) and many other books.
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